Indonesian government to mandate installing flowmeters at O&G wells

The Indonesian government is planning to force oil and gas contractors to install flowmeters at their wells after years of criticism over lack of production data in the field.

Energy and Mineral Resources Ministry’s oil and gas director general IGN Wiratmaja Puja said the government would stipulate the installation of flowmeters through a ministerial regulation in a bid to increase the accuracy of measuring daily crude production in the country.

The impending regulation comes as Indonesia’s oil and gas production decreases at an average rate of 20% per year as most fields have already shown a natural decline. 

The Upstream Oil and Gas Regulatory Special Task Force (SKKMigas) has thus far relied on daily oil and gas production reports submitted by contractors.

There are no regulations making it compulsory to install flowmeters, which measure the real flow rate or the quantity of oil and gas.

“The objective of the flowmeter installation is to monitor production, and the data will be delivered to SKKMigas on a real-time basis, which will also be transferred to the Energy and Mineral Resource Ministry,” Wiratmaja told The Jakarta Post.

He explained that currently flowmeters were only installed at oil and gas points of delivery to measure ready-to-sell production, known as lifting.

Although the variance between oil lifting and total production is limited, at only around 0.25 to 1.6%, it provides greater accuracy for monitoring purposes.

Declining to disclose the exact date of the ministerial regulation issuance, Wiratmaja said the flowmeters would be procured using state funds and the installation will be conducted by SKKMigas.

“The flowmeters will be the state’s property while SKKMigas will be tasked with installing and operating the equipment,” he said. 

According to data from SKKMigas, national crude oil production reached 817,900 barrels of oil per day (bopd) and gas production hit 7.9 trillion cubic feet (tcf) a day in the first half of the year.

Meanwhile, oil and gas lifting was at 1.9 million barrels of oil equivalent a day (boepd), slightly exceeding SKKMigas’ target set in this year’s work plan and budget of 1.94 million boepd. 

The country’s oil lifting has largely been supported by fields including Chevron’s Rokan field and ExxonMobil’s Cepu field, with lifting rates of 256,400 and 154,700 bopd, respectively. 

Meanwhile, Total E&P’s Mahakam field and BP Tangguh’s Berau, Muturi and Wiriagar fields were the main contributors to gas lifting in the first half of 2016, with 280,900 and 167,000 boepd, respectively. 

Although oil lifting and production have largely exceeded this year’s targets, the figures are behind Indonesia’s heyday in the 1970s when oil production reached a peak of 1.7 million bopd. 

Ageing wells and a lack of new oil and gas reserve discoveries have been blamed for the decline.

126 queries in 0.725 seconds.